Paying $ to Pay Taxes is Just More Corporate BS

Big Business and government are colluding to do us harm

Patsy Fergusson
Apr 16 · 6 min read
Photo by Emil Kalibradov on Unsplash

The first time I paid my taxes online I was delighted. No more running around to the post office and the library looking for random forms. No more sitting at the dining table surrounded by stacks of paper for days on end, hunkering over the instruction manual, trying to understand what I was doing, filling the forms in first with pencil and later with pen, in case I made errors, which I always did.

Doing it on my computer, by contrast, was a breeze! TaxAct Online said filing my taxes with them was going to be free, but at the end of the process they clarified that they meant the federal taxes were free. If I wanted them to import all the data I’d just spent some hours entering onto my state tax forms, it would cost me $19.99. Oh well, I thought. Still a bargain.

This year, though? Not the same. This year filing my taxes cost me $134.90. Every time I needed a new form, it was another $20. To add insult to injury, they had a little pop-up picture of a woman constantly harassing me, asking if I wanted to pay for tax advice from an “expert.” Like a bad man at a drunken party, the pop-up wouldn’t take no for an answer, no matter how many times I shut it down. But the final straw that soured me to the experience came after my friend asked me to help him with his taxes.

On the front page of TaxAct Online it says they will give me a $20 gift card for referring a friend, and give that friend a 20 percent discount their first year. But no matter how many times I pressed the referral link, it wouldn’t materialize. So I went ahead and spent some hours with my friend, entering his data, which even though he makes almost zero money still cost $134.90 to file because he needed a few common forms. Then at the very end, after paying and filing, that cursed link popped up. Refer a friend! Get a $20 gift card! And this time when I pressed it, it worked! But too late, of course. You have to manifest a working link before you help your friend file his taxes.

That pissed me off enough that I wrote an email to the company, and got a thorough runaround in six emails back and forth from two departments, until I was finally and completely convinced that TaxAct Online is an evil company. Surprise! For all I know, human beings don’t even work there, because the scripted answers kept coming, no matter how hard I pled.

When I told this tale of woe to my husband he said all the online tax filing companies are rat bastards and I chastised him, explaining how much easier they have made my tax filing life. But then I stumbled on a story that proved him right. As it turns out, those companies promised to give taxpayers a free filing option. That’s the deal they made with the government almost 20 years ago, when they pressured the IRS not to make a simple and easy online system of its own.

If you want the complete story, read this excellent piece:

If you want a bare summary, here it is.

Intuit‘s TurboTax is the biggest bad guy

For more than 20 years, Intuit has been waging war against plans the IRS developed to make filing taxes simple and free for most U.S. citizens, as it is in wealthy countries throughout the world, according to Justin Elliott and Paul Kiel, who wrote the ProPublica piece.

“Internal presentations lay out company tactics for fighting ‘encroachment,’ Intuit’s catchall term for any government initiative to make filing taxes easier — such as creating a free government filing system or pre-filling people’s returns with payroll or other data the IRS already has.”

That made me sit up and take notice. Of course the IRS should be filling out forms for us, pouring in the data they already have from employers, pension funds, investment funds, etc. Why are they getting data from these companies, then asking citizens to send them the same data, then hiring people to compare them and mount an audit if they don’t match? What a waste of time and money!

Key to Intuit’s (and other companies’) battle against “encroachment” was a promise they made back in the day to provide free tax filing to tens of millions of customers if the IRS agreed it wouldn’t create a simple tax filing system of its own. But just like that $20 referral link, they never delivered what they promised.

Technically, they may offer free tax filing, but they deliberately make it super hard to find on their websites, and they use every loophole imaginable to force you to pay, such as charging extra for common forms.

One creepy tactic described in the story are the “dark patterns” which companies use to lure customers into buying things they don’t necessarily want by deliberately confusing them. Naming their mostly-paid program “Free File” is a dark pattern, garnering political support from people who assume that Intuit isn’t bald-faced lying — that “free” means without cost.

And if you still have any doubts about the company’s lack of integrity, consider the acronym FUD, which stands for the Fear, Uncertainty and Doubt that American taxpayers feel when working with our impenetrable tax filing instructions. Intuit employees are encouraged to tap into our FUD when designing and selling its products, internal documents show.

In 2019, Intuit and its cohort of pirates (TaxAct Online among them) almost succeeded in getting a law passed prohibiting the IRS from EVER making a free and simple tax filing program of its own. (!) But backlash inspired by ProPublica’s coverage derailed the plan and prompted a few investigations into Intuit’s business practices.

Of course, that doesn’t mean Intuit will give up on its goal of making us all pay through the nose. Because online tax prep is a multi-billion dollar business that is making a lot of people rich.

So I, for one, contacted President Joe Biden & Vice President Kamala Harris, Senate Majority Leader Chuck Schumer, House Majority Leader Nancy Pelosi, and my federal senators and representatives, asking them to instruct the IRS to make a free filing system that works for us all, saying something like this:

Thank you for all you’ve done so far and have announced you are going to do! I hope you will also find the time and political power to direct the IRS to create a free and easy way for citizens to file their taxes like other wealthy countries do. Predatory companies like Intuit should not be making billions while pretending the offer a “free file” option. They don’t. Instead, they use every loophole they can find to mislead and gouge taxpayers, charging even very-low-income citizens more than $135 to file. There’s no reason for taxpayers to hunt up figures the IRS already has. The IRS should offer pre-filled forms we can review and sign off on, and add to, if needed. Making paying taxes easy and free would save both taxpayer and government money, reduce audits, improve morale, and add to your already impressive legacy. THANKS AGAIN for all your good work so far.

Feel free to copy/paste, if you’re feeling proactive but at a loss for words.

Meanwhile, there’s this — for next year. Or maybe for this one, if you haven’t filed yet, since the deadline has been extended to May 17. But beware of dark patterns!

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Patsy Fergusson

Written by

Tree hugger. Tour guide. Top Writer. Feminist. Newly-baptized Bay swimmer. Editor of Fourth Wave.

Fourth Wave

Changing the world for the better, one story at a time, with a focus on women and other disempowered groups

Patsy Fergusson

Written by

Tree hugger. Tour guide. Top Writer. Feminist. Newly-baptized Bay swimmer. Editor of Fourth Wave.

Fourth Wave

Changing the world for the better, one story at a time, with a focus on women and other disempowered groups

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